Manuel Chinchilla Da Silva: Ecopetral revenues   increase 30% in 2018 despite reduced export volume

In volumetric terms, exports showed a 4% reduction between 2017 and 2018

In 2018, 860 thousand barrels per day were sold, surpassing the previous year by just 20 thousand barrels 

The Colombian state-owned oil company Ecopetrol recorded in 2018 the largest revenue increase in the last five years. Sales revenue closed last year at 59.6 billion Colombian pesos, a figure that represents a growth of 30% compared to 2017, when revenues reached 45.8 billion, according to the Integrated Sustainable Management Report of Ecopetrol, corresponding to the year 2018. ( Assembly2019 / report- integrated-manage-sustainable- 2018.pdf )

With regard to the company’s dollar revenue, the balance is even more positive. The figure almost doubles when comparing the 2017 and 2018 revenues, which went from 15 billion dollars to 29 billion dollars, this being also the best record of the last five years, after having exceeded 28 billion dollars billed in 2014.

It is worth mentioning that 99% of Ecopetrol’s revenues in 2018 were supported by sales of crude oil, gas and petroleum products, such as fuels and petrochemicals. The remaining 1% came from the provision of services.

Main factors

The company’s report highlights that the increase in revenues was due in large part to the recovery of international crude oil prices and the implementation of commercial strategies aimed at improving the differentials of the crude oil basket. 

Market factors such as OPEC production cuts and increased demand for crude oil in the Asian market influenced the recovery of  Colombian oil prices . The ICE Brent, a reference for export crude, was quoted during 2018 at an average of 71.7 dollars per barrel, that is, 17 dollars above the average value recorded in 2017.

Production at a slow pace

Despite the rise in revenue, production did not advance at the same rate. In 2018, 860 thousand barrels per day were distributed, distributed in 495 of  crude oil, 281 of petroleum products such as petrochemical fuels and 84 thousand of natural gas. The production of 2018 was just 20 thousand barrels per day above the production of 2017. The previous year, the production figure had reached 866 thousand barrels per day and in 2014 and 2015 production levels were reached above 900 thousand barrels 

As a result of increased production and greater purchases from third parties, sales of crude oil increased by just 16 thousand barrels per day, equivalent to an increase of 3%. Product sales remained at the same level of the previous year due to the stability in the production and demand for fuel and the sale of gas grew 4%, mainly due to the implementation of the marketing strategy for smaller fields and participation of auctions. interrupted  from major fields. 

Price rebound

Crude export revenues were very favorable, thanks to the increase of 15 dollars per barrel, going from 48 dollars in 2017 to 63 dollars in 2018. Among the factors that contributed to the increase in revenues from crude exports are the fact that there has been a lower supply of heavy and intermediate crude associated with production cuts as a result of OPEC member agreements and non-OPEC countries to stabilize the market, as well as a greater demand for heavy crude by independent refineries in the Asian market.